Modern Mining January 2018

MINING News

Teranga reports record gold production in 2017

of a Feasibility Study (FS) on the project in September last year. Based on initial gold reserves of 1,2 Moz, the FS base case dem- onstrated solid project economics with a 15 % IRR at US$1 250/oz gold for a 2,4 Mt/a CIL processing facility modelled on the Sabodala plant. The FS estimated the pre- production capex at US$232 million. “Our operational focus on generating free cash flow at Sabodala is paying off,” said Richard Young, Teranga’s President and Chief Executive Officer. “With record mill throughput and positive reconcilia- tion to ore reserve estimates, Sabodala achieved record gold production for the second consecutive year and exceeded 2017 production guidance. Our five- year profile for Sabodala estimates free cash flow of US$230 million between 2018 and 2022, including approximately US$90 million in free cash flow over the next two years.” The company is forecasting gold pro- duction at Sabodala of between 210 000 and 225 000 ounces of gold in 2018. This compares favourably to the 2018 produc- tion estimate of 213 000 ounces outlined in the 2017 Sabodala 43-101 technical report filed on August 30, 2017. Located 650 km east of Dakar, Sabodala is currently the only commercial-scale gold mine in Senegal but others are on the way, notably Toro Gold’s Mako project. Sabodala is a conventional open-pit/CIL operation. Added Young, “We are excited about 2018. Our expectations are for another year of strong production and cash flow Whilst optimum recoveries were achieved from the initial testwork (oxide sample TGC = 87 % and fresh sample TGC = 96 %), TGC recoveries are expected to improve during future testwork phases through further flowsheet optimisation and recycling of intermediate tailings streams during locked cycle testing. Current testwork was all carried out under open- circuit conditions with the above recoveries excluding graphite from intermediate tail- ings streams. Mustang Interim Executive Chairman Ian Daymond said the latest results confirmed that Caula was a Tier 1 graphite project. flotation followed by three intermediate re-grind stages and five cleaner flotation stages.

The processing plant at the Sabodala gold mine in Senegal (photo: Teranga).

Teranga Gold Corporation, listed on the TSX, has reported record gold production of 233 267 ounces in 2017, exceeding the high end of its annual production guid- ance range of 205 000 to 225 000 ounces. Teranga owns the Sabodala gold mine in Senegal, which has been producing since 2010. Due to higher production and gold prices, the company ended the year with a strong cash position of approximately U$88 million, an increase of US$15 million from September 30, 2017. The company’s strong financial posi-

tion supports its ability to finance its next mine, Banfora, which has been renamed Wahgnion to reflect the wishes of the local community. Early works activities at Wahgnion are underway in the lead- up to closing a project debt facility and the commencement of mill construction, both anticipated to occur in the second quarter of 2018. Wahgnion is located in the south-west of Burkina Faso. The project was acquired in October 2016 as part of Teranga’ acqui- sition of ASX-listed Gryphon Minerals. Teranga announced the positive results These results are based on additional testwork (on both oxide and fresh samples) managed by Wave International (Wave) and Independent Metallurgical Operations (IMO), and conducted at the Metallurgy Pty Ltd laboratory. The testwork was aimed at providing additional information to enhance the upcoming scoping study. Samples were compiled from quarter diamond drill core samples collected during the recent (2016) resource drilling campaign at Caula. The same, simplified testwork flowsheet has now been utilised on both the oxide and fresh samples. It comprised an initial coarse grind to 0,71 mm, a deslime stage (by-passed on fresh), three-stage rougher

Metallurgical testwork returns positive results ASX-listed Mustang Resources reports that further metallurgical testwork on oxide and fresh samples taken from its 80 %-owned Caula graphite project (Licence 6678L) in northern Mozambique has provided more firm evidence of the quality of the min- eralisation. Caula is located along strike from Syrah Resources’ world-class Balama graphite project, which has now entered production.

The testwork produced an improved flake distribution on the oxide material, quantified the proportion of high revenue Super Jumbo (>500 µm) flake and improved the amorphous (<75 µm) grade from both oxide and fresh samples.

6  MODERN MINING  January 2018